10 Questions
According to the Theory of Demand, what is the relationship between the quantity demanded of a commodity and its price?
Inversely related
What does the Theory of Derived Demand explain?
The application of demand theory
What is the definition of demand?
The quantity of a commodity that a consumer is capable of buying and is willing to pay the given price for
What is the Theory of Demand?
A law that states the relationship between quantity demanded and price
What does the Law of Demand state?
The quantity demanded of a commodity is inversely related to its price
Which one of the following is the correct definition of demand?
The quantity of a commodity that a consumer is capable of buying and is willing to pay the given price for it at the given time.
Which one of the following is NOT a factor affecting demand?
Price of the commodity
According to the Law of Demand Theory, what is the relationship between the quantity demanded of a commodity and its price?
Inversely related
What does the Theory of Derived Demand explain?
The demand for a product that is derived from the demand for another product
What does the Demand Curve represent?
The relationship between the quantity demanded of a commodity and its price
Study Notes
Demand Theory
- The Theory of Demand explains the relationship between the quantity demanded of a commodity and its price.
- The Law of Demand states that as the price of a commodity increases, the quantity demanded decreases, ceteris paribus (all other things being equal).
Derived Demand
- The Theory of Derived Demand explains that the demand for a resource, such as labor, is derived from the demand for the goods and services it produces.
Definition of Demand
- Demand is the quantity of a commodity that consumers are willing and able to purchase at a given price level during a particular period of time.
Factors Affecting Demand
- The following are factors that affect demand: consumer preferences, income, prices of related goods, population, and consumer expectations.
Demand Curve
- The Demand Curve represents the various quantities of a commodity that consumers are willing and able to purchase at different price levels during a particular period of time.
Test your knowledge of the Theory of Demand with this quiz! Learn about its definition, factors that affect it, and solve examples to strengthen your understanding.
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